Andy Burnham Merges UK Tech and Business Departments

The UK government has merged the Department for Science, Innovation and Technology into other ministries in a restructure that Prime Minister Andy Burnham says will strengthen the country's business environment. Most responsibilities from the department, known as DSIT, will transfer to former business secretary Jonathan Reynolds, who now leads the newly created Department for Business, Innovation, Science and Trade.

The remaining functions will move to the Department for Culture, Media and Sport, which is being renamed the Department for Digital, Culture, Media and Sport under Lisa Nandy. The consolidation could signal a shift in how the government approaches technology policy as part of its wider economic growth agenda, though industry figures have expressed concern about the timing and execution of the change.

DSIT was established in 2023 under former Conservative Prime Minister Rishi Sunak and had focused on areas including quantum computing research, clean energy programmes and data centre infrastructure.

Industry calls for continuity

Technology sector representatives had lobbied against dissolving the department before the announcement was made. Julian Har, Chief Executive of techUK, and Dom Hallas, Executive Director at Startup Coalition, sent a joint letter to Burnham arguing that the proposal represented "the wrong change at the wrong time."

"DSIT works because it brings researchers, AI practitioners, innovators and policymakers together in one department – a single front door that gives the tech sector clarity, pace and a government partner that understands technology and champions the sector in the Cabinet," they wrote. The letter warned that fragmenting initiatives such as the AI Safety Institute, the Sovereign AI fund, GDS and UKRI could slow momentum when speed is essential for economic growth and global competitiveness.

The technology sector contributes £1.2tn (US$1.6tn) to the UK economy and is growing at 10% annually, according to industry figures. Business leaders have questioned whether redistributing responsibilities across multiple departments will maintain the focus required to support this growth trajectory.

Concerns over business confidence

James Cobb, CEO and Founder of UK location intelligence company Crowd Connected, argued that the restructure could undermine the government's credibility with technology businesses. "You don't show you take AI seriously by appointing a minister while scrapping the department that understood it," James says.

"A Minister for AI is welcome, but a minister without a department is simply a spokesperson. AI bolted onto a traditional organisation delivers very little. Appointing an AI minister while dissolving the department that understands the technology is a step backwards, not forwards."

Charlotte Wilson, Head of Enterprise at Check Point, raised concerns about the economic and security implications. "Britain's AI department is at the forefront of the country's productivity strategy, playing a crucial role in how the technology will be developed and rolled out to drive wider economic growth and defence," Charlotte notes.

"Incoming policymakers should take heed – AI is the gorilla in the room and will remain so for the foreseeable future. Any suggestion of redeployment or downsizing could send the wrong signal to businesses and cyber criminals about how seriously we take the most transformational technology in living memory."

Some industry voices have suggested the reshuffle could present an opportunity if implemented efficiently. Tim Flagg, CEO of trade association UKAI, said the move does not necessarily indicate a retreat from technology ambitions.

"AI has the potential to transform Britain's economy, our public services and our security for a generation," Tim says. "Rethinking which department oversees this industry does not necessarily mean Burnham's Britain is turning its back on that potential. It could even signal an ambition to go further: AI elevated into a super-department or placed at the very heart of the Cabinet Office. The real danger isn't the ambition – it's the distraction and the delay."

First dedicated AI Minister

The government has created a new role to oversee artificial intelligence policy, appointing Kanishka Narayan as the UK's first dedicated AI Minister. Narayan previously served as Minister for AI and Online Safety from September 2025 under former Prime Minister Keir Starmer.

"AI is likely the most significant technology in human history," Narayan wrote on X following his appointment. "Its impact will dwarf other things. Nations have a narrow window to decide whether they shape AI or get shaped by it. Britain is in that window right now. While that window is still open, I will act with pace, I will act with ambition, and I will focus relentlessly on securing British influence in shaping AI."

France and Canada have both established senior government positions dedicated to artificial intelligence in recent years. Narayan's challenge will be delivering policy and supporting business growth while working across multiple departments rather than within a single ministry focused on technology.

The restructuring occurs as UK businesses show mixed confidence in AI tools. According to research from engineering and technology consulting firm Expleo, nearly a third of business leaders report that losing their current AI tools would leave their work completely unaffected. Only 24% believe their tasks would become more complex without AI, which could suggest current tools are not delivering measurable improvements in productivity.

Business leaders in emerging technology sectors have warned that delays caused by departmental reorganisation could affect critical policy work. Tony Kounnis, CEO of Face Int UK & Europe, a technology startup specialising in identity verification, said sector investment and policy development must not stall.

"Technology, one of the UK's priority sectors, is vital to economic growth," Tony adds. "Any delays to sector investment and policy development caused by the redistribution of DSIT's responsibilities could be costly."

The transition period could determine whether the restructure delivers on the government's stated goal of creating a more business-friendly environment or whether fragmented responsibilities slow the pace of policy development that technology companies require.